From Accounting Today online:
The Internal Revenue Service said Thursday that only three weeks
after the opening of tax season, it has already received about one-third
of the individual income tax returns it expects to receive in 2014.
The
IRS reported that tax season has gone smoothly so far, despite the
two-week delay before kicking off tax season on January 31. The IRS has
processed almost 98 percent of the 49.6 million returns received so
far. Each week this filing season, the IRS has processed a greater
percentage of the returns received than during comparable weeks last
year.
More taxpayers are filing their returns electronically this
year. Overall, 46.6 million returns have been e-filed this year, up 1
percent from the same time last year.
Click here to read more.
Friday, February 28, 2014
Tuesday, February 11, 2014
Update on IRS telephone assistance...you
From the Weekly Standard:
New IRS commissioner John Koskinen is beginning his tenure with some blunt words: If you need IRS help on the telephone, be prepared to wait -- a long time. The IRS posted a YouTube video of the commissioner's message to taxpayers as the pace of the 2014 filing season picks up. The commissioner says the long wait times are due to the "very limited resources" available to the IRS. "I want to be up front with you, and call it like it is," he says, before warning of "extensive wait times."
“We want to provide you with the assistance you need to get your taxes filed accurately and on time,” Koskinen added. “And we will work hard to issue refunds quickly while increasing our efforts to stop tax fraud and identity thieves.”
Koskinen also cautioned taxpayers that phone lines will be busy this year. “Given our very limited resources, our phone lines are going to be extremely busy this year – and there will frequently be extensive wait times,” Koskinen said. “We are working to limit these waiting times as much as possible, and I apologize that we can’t do more in that regard this year.”
The wait times have grown exponentially as tax season starts up. When we asked an IRS why we had to wait more than an hour to speak with her, her response was matter of fact. "It is Monday," she told us.
Read more by clicking on this link.
Monday, February 10, 2014
Sunday, February 9, 2014
February 1, 2014 Client Newsletter
Your tax guys are just ecstatic. As I write to you today the IRS has accepted all...and I underline all... of the income tax returns we have filed with them to date. This is very good news. Last year at this time filing tax returns was really a nightmare But it appears, at least to date, since we have already filed and had corporate returns accepted, none of the problems we have had last year have returned. With that said, we encourage you to file early rather than later. If you have a refund, great. You will get your money sooner. If you owe, sorry, you have time to arrange payment.
Remember the due date for your corporate income tax return is March 15, 2014. Can’t meet the deadline? We will file an automatic six month extension for you.
Much has been written about the state of the Affordable Care Act (ACA) since its’ roll out last year. Frankly I was a little surprised to read Victor Puleo, associate professor of insurance and risk management at the University of Central Arkansas in Conway quoted in Bank Rate.com as giving the ACA roll out a B-. I think the that may be a little generous. The rating service Moody's has just lowered ratings for many health insurance companies. Apparently the insurance companies are set to raise premiums in May 2014. Some premiums may rise as much as 25 percent. The Supreme Court is expected to rule in June about the ACA’s contraception mandate. Large health insurance companies such as AETNA are already threatening to pull out of the ACA.
You may benefit from the small business health insurance credit portion of the ACA, as the credit increases to 50 percent of the employer’s contribution this year. Your business must have 25 or fewer full-time, or equivalent, employees and provide affordable health insurance, while picking up the tab for at least half of the premiums. However, if you are sole owner-employee of your business don’t count on the credit. If you are a sole proprietor, a partner, a shareholder owning more than two percent of an S corporation, or you own more than five percent of the business, you are not considered an employee for purposes of the tax credit. Thus, your wages or hours are not counted in determining either the number of full time employees or the amount of average annual wages, and premiums paid on your behalf are not counted in determining the amount of the credit. Family members of any of the business owners are not considered employees for purposes of the tax credit. Their wages and hours are not counted in determining the number of full time employees or the amount of average annual wages, and premiums you pay their behalf are not counted in determining the amount of the credit. This means that if you are eligible for credit as a one person small business, you will have to apply individually credit. Depending on household size and income this credit can be very generous. Frankly the individual credit is a better deal.
The last day you have to avoid the ACA penalty for not being insured is March 15, 2014.
Looking ahead to this year’s taxes 55 “temporary” tax breaks expired at the end of 2013, and Congress has failed to renew these provisions. Granted, Congress has a track record of sometimes renewing tax breaks retroactively, but we all know what happens to those who assume. You should be aware of the IRC 179 expensing deduction reverts to the normal rule. For many companies, this means their available expensing of equipment purchases is going from $500,000 to $25,000.
There are other added taxes to consider. The new PPACA tax or “fee” on health insurance companies – estimated at $8 billion in 2014 – is a cost that is likely to be passed on to employers and consumers as we mentioned above. Also, the individual tax for failing to sign up for qualifying health care is still effective in 2014. Plus, the added investment and wages taxes associated with incomes over $250,000 (married filing jointly) is not inflation adjusted. There are also a number of individual credits, deductions and tax breaks that are no longer available in 2014. They deal with education, personal residences, local taxes, charitable giving and other expenses that business owners may incur personally.
Still not perfect though. Our podcasts from your tax guy are now online. We have linked to them from our blog or our website 1taxes.com. Our latest episode talks about what is going on during the early start of tax season.
Please note our office will be open every day until April 15, 2014..
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